Branding in Emerging versus Developed Markets: Assessing Consumer Perspectives
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1 Branding in Emerging versus Developed Markets: Assessing Consumer Perspectives Robin Coulter, University of Connecticut Yuliya Strizhakova, Rutgers University Linda L. Price, University of Arizona 2013 China India Insights Program September 19-21, 2013
2 From Brands to Branded Products An AHA Experience ~ Central Europe in the Early 90 s The marketplace Few products and few brands Retailing without systematic suppliers The grey market Country ideologies Political ideologies Gendered ideologies Consumers becoming socialized about a consumer culture Learning to shop, compare, decide Brand experimentation, despite satisfaction with brands Involvement with products and branded products Differences across ages and residence (rural/urban)
3 Evolving Consumer Culture and Cultural Identity in Emerging Markets Opening of borders, increased communication, and an infusion of global brands by multinational firms: inspired a consumer culture in emerging markets. promoted a dialogue between localization and globalization. Branded products began to have meanings quality, identity, traditions and values Cultural identity ~ the coexistence of a broad range of beliefs and behaviors embedded to varying degrees in local and global discourses (Alden, Steenkamp & Batra 2006; Kjeldgaard & Askegaard 2006; Steenkamp & de Jong 2010; Strizhakova, Coulter & Price 2012; Tu, Khare & Zhang 2012).
4 Cultural Identity in Emerging Markets (Strizhakova, Coulter & Price, IJRM, 2012) Conceptualizing Cultural identity ~ the interplay between globalization and nationalism considering: Global citizenship through global brands Consumer ethnocentrism Nationalism Profiling in the pooled data for Russian and Brazil 2010 data Focus on young adult cohort; global, local and other brands; Russia 2009, 2010; Brazil 2010 Key Findings: Segment size varies over time: Russia (from ), the glocal segment increased from 41%-50% of the cohort. Segments vary across countries: Russia had no global segment, whereas in Brazil 31% were in the global segment. Consistencies in greater importance of global and global and local (relative to unbranded) products in the global and glocal segments. Global and glocal segments are concerned about quality and identity brand signals; nationally engaged and unengaged focus on quality.
5 Global Cultural Identity, Materialism and Friendly Tendencies (Strizhakova, Coulter & Price, IJRM, 2013) Economic development and consumer culture are fueling materialism in emerging and developed markets (Belk et al. 2003; Ritzer 2007). Companies expanding into emerging markets are promoting environmentally friendly behaviors, environmental concern is becoming an important pillar of global citizenship, and a more pressing global issue and expression of global culture (Osterhus 1997; Thompson 2005). Research Question: Does having a global relative to local cultural identity impact the relationship between materialism and environmentally friendly tendencies in emerging vs. developed countries? Individuals with a stronger global cultural identity Stronger materialistic values and more positive attitudes toward global brands (Alden, Steenkamp & Batra 2006; Riefler 2012; Steenkamp and de Jong 2010). Greater acculturation to global consumer culture (Cleveland and Laroche 2007).
6 Consumers in Developed vs. Emerging Markets Developed markets for many years economic and environmental sustainability have been perceived as mutually exclusive due to the adverse effect of increased consumption on the environment in developed markets (Hoffman 1997; Grove 2002). Globalization processes have highlighted interdependence and more complex relationships between economic and environmental sustainability (Adams 2006). We argue: Consumers in developed markets may find it more difficult to integrate the historical perspective of trading off environmental versus economic sustainability and the new interdependent sustainability perspective vs Consumers in emerging markets who because of globalization have more recently been exposed to economic and environmental sustainability.
7 Conceptual Framework Ho: Individuals who exhibit a stronger global cultural identity are more likely to hold materialistic values and be more engaged in environmentally friendly tendencies. Friendly Tendencies Concern for Friendly Products Global Cultural Identity + Willingness to Pay Extra for Friendly Products Materialism Emerging BRIC >Developed Market Perceptions of Global Companies as Friendly Ho: The moderating effect of global cultural identity on the relationship between materialism and environmentally friendly tendencies will be stronger in the emerging BRIC than the developed market. Likelihood to Engage in Friendly Behaviors
8 Method and Sample Online survey = yrs (33% in 3 age groups), 50% gender Total sample = 1872 BRIC (Brazil=319, Russia=328, India=305, China=295) Developed (USA=302, Australia=323) N Females % Age M (SD) Average travel abroad in 5 years M (SD) Born in the country % Middle class % Collegeeducated % Residing in city and suburbs % Emerging BRIC Market (11) 2.0 (4.1) Brazil (12) 1.5 (3.4) Russia (11) 2.2 (4.0) India (12) 1.9 (4.2) China (11) 2.2 (5.6) Developed Market (12) 1.3 (3.4) USA (12) 1.4 (4.4) Australia (13) 1.3 (2.4)
9 Measurement Materialism (Richins 1987; 4 items) It is important to me to have really nice things. I would like to be rich enough to buy anything I want. It sometimes bothers me quite a bit that I cannot buy all the things I want. I'd be happier if I could afford to buy more things Global cultural identity 3 alternative measures Global Lifestyle Orientation (Alden, Steenkamp & Batra 2006) It is important for me to have a lifestyle that I think is similar to the lifestyle of consumers in many countries around the world rather than one that ismore unique to or traditional in (my country). Global Brand Orientation (Alden, Steenkamp & Batra 2006) I prefer to buy brands that I think are bought by consumers in many counties around the world rather than local brands that are sold in only (my country). Global connectedness I have a strong attachment to the global world. I feel connected to the global world. I think of myself as a global citizen. It is important to me to feel a part of the global world. T hinking about my identity, I view myself as a global citizen. Feeling like a citizen of the world is important to me. I would describe myself as a global citizen.
10 Measurement Friendly Tendencies Concern for environmentally friendly products When purchasing a new product, how concerned (not at all concerned/ very concerned) are you that the product is made from: environmentally friendly materials packaged in biodegradable materials made from recycled materials Willingness to pay extra for environmentally friendly products Perceptions of global companies as environmentally friendly Based on what you know about each of the following companies, please indicate the extent to which you believe the company is or is not environmentally responsible? (automotive: Toyota and Mercedes; electronics: Samsung and Apple; food-beverage: Coca-Cola and McDonalds) Likelihood to engage in environmentally friendly behaviors Recycling Conserving use of energy at home Conserving use of water at home Minimizing household waste/trash to protect the environment.
11 Moderating Effects of Lifestyle Orientation Lifestyle orientation as the moderator of the materialism and environmentally friendly tendencies relationship: SEM results. Emerging BRIC Market Unstandardized Estimates Bootstrap bias-corrected method 95%CI SE Lower Upper p-value Global Segment (n = 142) Materialism on concern for environmentally friendly products Materialism on willingness to pay extra for environmentally friendly products Materialism on perceptions of global companies as environmentally friendly Materialism on likelihood to engage in environmentally friendly behaviors Glocal Segment (n = 659) Materialism on concern for environmentally friendly products Materialism on willingness to pay extra for environmentally friendly products Materialism on perceptions of global companies as environmentally friendly Materialism on likelihood to engage in environmentally friendly behaviors Local Segment (n = 239) Materialism on concern for environmentally friendly products Materialism on willingness to pay extra for environmentally friendly products Materialism on perceptions of global companies as environmentally friendly Materialism on likelihood to engage in environmentally friendly behaviors Alienated Segment (n = 205) Materialism on concern for environmentally friendly products Materialism on willingness to pay extra for environmentally friendly products Materialism on perceptions of global companies as environmentally friendly Materialism on likelihood to engage in environmentally friendly behaviors Model Fit: χ 2 (628) = , CFI =.91, TLI =.90, RMSEA <.04 Lifestyle orientation as the moderator of the materialism and environmentally friendly tendencies relationship: SEM results. Developed Market Unstandardized Estimates Bootstrap bias-corrected method 95%CI SE Lower Upper p-value Global Segment (n = 37) Materialism on concern for environmentally friendly products Materialism on willingness to pay extra for environmentally friendly products Materialism on perceptions of global companies as environmentally friendly Materialism on likelihood to engage in environmentally friendly behaviors Glocal Segment (n = 175) Materialism on concern for environmentally friendly products Materialism on willingness to pay extra for environmentally friendly products Materialism on perceptions of global companies as environmentally friendly Materialism on likelihood to engage in environmentally friendly behaviors Local Segment (n = 259) Materialism on concern for environmentally friendly products Materialism on willingness to pay extra for environmentally friendly products Materialism on perceptions of global companies as environmentally friendly Materialism on likelihood to engage in environmentally friendly behaviors Alienated Segment (n = 154) Materialism on concern for environmentally friendly products Materialism on willingness to pay extra for environmentally friendly products Materialism on perceptions of global companies as environmentally friendly Materialism on likelihood to engage in environmentally friendly behaviors Model Fit: χ 2 (628) = , CFI =.94, TLI =.93, RMSEA <.04
12 Moderating Effects of Brand Orientation Brand orientation as the moderator of the materialism and environmentally friendly tendencies relationship: SEM results. Emerging BRIC Market Unstandardized Estimates Bootstrap bias-corrected method 95%CI SE Lower Upper p-value Global Segment (n = 205) Materialism on concern for environmentally friendly products Materialism on willingness to pay extra for environmentally friendly products Materialism on perceptions of global companies as environmentally friendly Materialism on likelihood to engage in environmentally friendly behaviors Glocal Segment (n = 758) Materialism on concern for environmentally friendly products Materialism on willingness to pay extra for environmentally friendly products Materialism on perceptions of global companies as environmentally friendly Materialism on likelihood to engage in environmentally friendly behaviors Local Segment (n = 73) Materialism on concern for environmentally friendly products Materialism on willingness to pay extra for environmentally friendly products Materialism on perceptions of global companies as environmentally friendly Materialism on likelihood to engage in environmentally friendly behaviors Alienated Segment (n = 203) Materialism on concern for environmentally friendly products Materialism on willingness to pay extra for environmentally friendly products Materialism on perceptions of global companies as environmentally friendly Materialism on likelihood to engage in environmentally friendly behaviors Model Fit: χ 2 (628) = , CFI =.91, TLI =.90, RMSEA <.04 Brand orientation as the moderator of the materialism and environmentally friendly tendencies relationship: SEM results. Developed Market Unstandardized Estimates Bootstrap bias-corrected method 95%CI SE Lower Upper p-value Global Segment (n = 29) Materialism on concern for environmentally friendly products Materialism on willingness to pay extra for environmentally friendly products Materialism on perceptions of global companies as environmentally friendly Materialism on likelihood to engage in environmentally friendly behaviors Glocal Segment (n = 240) Materialism on concern for environmentally friendly products Materialism on willingness to pay extra for environmentally friendly products Materialism on perceptions of global companies as environmentally friendly Materialism on likelihood to engage in environmentally friendly behaviors Local Segment (n = 142) Materialism on concern for environmentally friendly products Materialism on willingness to pay extra for environmentally friendly products Materialism on perceptions of global companies as environmentally friendly Materialism on likelihood to engage in environmentally friendly behaviors Alienated Segment (n = 214) Materialism on concern for environmentally friendly products Materialism on willingness to pay extra for environmentally friendly products Materialism on perceptions of global companies as environmentally friendly Materialism on likelihood to engage in environmentally friendly behaviors Model Fit: χ 2 (628) = , CFI =.94, TLI =.93, RMSEA <.04
13 Moderating Effects of Global Connectedness Global connectedness as the moderator of the materialism and environmentally friendly tendencies relationship: SEM results. Bootstrap bias-corrected method 95%CI Unstandardized SE Lower Upper p-value Estimates Emerging Market Strong Global Connectedness (n = 608) Materialism on concern for environmentally friendly products Materialism on willingness to pay extra for environmentally friendly products Materialism on perceptions of global companies as environmentally friendly Materialism on likelihood to engage in environmentally friendly behaviors Weak Global Connectedness (n = 593) Materialism on concern for environmentally friendly products Materialism on willingness to pay extra for environmentally friendly products Materialism on perceptions of global companies as environmentally friendly Materialism on likelihood to engage in environmentally friendly behaviors Model Fit: χ 2 (628) = , CFI =.93, TLI =.92, RMSEA <.06 Developed Market Strong Global Connectedness (n = 302) Materialism on concern for environmentally friendly products Materialism on willingness to pay extra for environmentally friendly products Materialism on perceptions of global companies as environmentally friendly Materialism on likelihood to engage in environmentally friendly behaviors Weak Global Connectedness (n = 302) Materialism on concern for environmentally friendly products Materialism on willingness to pay extra for environmentally friendly products Materialism on perceptions of global companies as environmentally friendly Materialism on likelihood to engage in environmentally friendly behaviors Model Fit: χ 2 (314) = , CFI =.96, TLI =.95, RMSEA <.05
14 Global Cultural Identity Segment Differences in Friendly Tendencies Global cultural identity segment comparisons for environmentally friendly tendencies in emerging BRIC market and developed market Global Cultural Identity Segment Comparisons Concern for Friendly Products χ 2 difference test for Friendly Tendencies Willingness to Pay Extra for Friendly Products Perceptions of Global Companies as Friendly Likelihood to Engage in Friendly Behaviors Dimension Lifestyle Brand Lifestyle Brand Lifestyle Brand Lifestyle Brand Emerging BRIC Market Global vs. Glocal a 20.65*** 6.58** 6.49* * 8.02** 17.54*** 2.15 Global vs. Local 15.68*** 7.02** 5.63* * 13.16*** 13.66***.46 Global vs. Alienated 16.11*** 14.42*** 12.47*** * 7.56** 13.53*** 5.21* Glocal vs. Local Glocal vs. Alienated * 3.98* * Local vs. Alienated * * Developed Market Global vs. Glocal 5.03* 6.01* * 16.20*** **.44 Global vs. Local 5.97* 3.92* * 14.24*** **.01 Global vs. Alienated 10.85*** 4.56* * 12.58*** **.43 Glocal vs. Local Glocal vs. Alienated Local vs. Alienated Global Connectedness (strong vs. weak) Emerging BRIC Market 5.90** 4.60** 5.50** 4.41** Developed Market *.85 a The reported χ 2 tests in each row indicate whether there is a significant difference between the two identified segments on each of the environmentally friendly tendencies. Note: * p <.05, * p <.01; *** p <.001
15 Global Cultural Identity Segment Differences in Friendly Tendencies Comparison of environmentally friendly tendencies for global cultural identity segments for the emerging BRIC market versus the developed market. Global Cultural Identity Segment Concern for Friendly Products χ 2 difference test for Friendly Tendencies between Emerging BRIC and Developed Markets a. Willingness to Pay Extra for Friendly Products Perceptions of Global Companies as Friendly Likelihood to Engage in Friendly Behaviors Lifestyle Orientation Global **.19 Glocal ** 4.57** Local Alienated Brand Orientation Global Glocal 5.95* 3.73* Local Alienated Global Connectedness Strong 6.06** 4.87* ** Weak a Significant effects were stronger in emerging BRIC than developed market.
16 Overview of Findings: Moderating Effects of Global Cultural Identity Materialism Emerging BRIC Global Cultural Identity Global Glocal Local Alienated + + Global Cultural Identity Global Glocal Local Alienated Friendly Tendencies Concern for Friendly Products Willingness to Pay Extra for Friendly Products Perceptions of Global Companies as Friendly Likelihood to Engage in Friendly Behaviors Developed Market Moderated effects were assessed in AMOS using bootstrapping bias-corrected procedure (Preacher and Hayes 2008). We used 2000 samples and 95% CIs.
17 Thoughts on Branded Products and Consumers in Emerging Markets Branded products in emerging markets are an important component in the evolution of a consumer culture. The global consumer segment is much smaller than the glocal segment, and the sizes of these are evolving within countries. Consumers with a stronger global and glocal cultural identity are buying global brands. attuned to the quality and identity aspects of brands. engaged in environmentally friendly behaviors, important to global sustainability. Local brands are gaining ground in the emerging markets Local companies need to consider the importance of signaling identity in their marketing of brands. Targeting of the local and glocal customer segments. Local brands from emerging markets (Embraer, LukOil) area becoming prominent players in the global arena.
18 Comments? Questions?
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